Banks' market cap falls 9.0pc in two weeks amid price correction

The share prices of listed banks witnessed correction amid increased turnover recently on the Dhaka Stock Exchange (DSE).

Following the price correction, the market capitalisation of the banks declined by 9.0 per cent or above Tk 56.4 billion in last 13 working days.

On August 28 last, market capitalisation of the banking sector was above Tk 628.30 billion and the value declined to above Tk 571.90 billion on September 13.

The premier bourse DSE featured a turnover of above Tk 6.12 billion on August 28 last and the value stood at above Tk 10.64 billion on September 13.

Following investors' increased participation, the daily turnover increased but the participation in banking sector declined in last 13 working days.

During the period, investors' participation in the securities of listed banks also declined.

All listed banks featured a total turnover of above Tk 921.9 million on August 28 last in the premier bourse DSE.

Later, the total turnover declined to above Tk 533.90 million on September 13.

Of 30 listed banks, the market prices of 25 banks declined on Thursday last when the share price of only two banks rose marginally and three others remained unchanged.

Md. Moniruzzaman, managing director of IDLC Investments, said the banks observed a rally in August this year.

"I think investors are waiting to observe the impact of the interest rate cut. That's why many investors adopted wait and see strategy in taking fresh position in the banking sector," he said.

He said the impact of the reduced interest rate might be clear in the financial statements for the July-September quarter.

Another stock broker said the recent news regarding the rise in banks' NPLs (non-performing loans) might be a reason behind the investors' less participation in banking sector.

Meanwhile, the banks displayed mixed performance in April-June quarter of 2018.

The banks which reported increased consolidated EPS are Bank Asia, BRAC Bank, Dutch-Bangla Bank, Eastern Bank, Islami Bank, Jamuna Bank, Mercantile Bank, Premier Bank, Prime Bank, Pubali Bank and Shahjalal Islami Bank.

AB Bank reported consolidated EPS of Tk 0.24 for April-June, 2018 against Tk 0.47 for same period of the previous year.

Of other banks, Al-Arafa Islami Bank reported consolidated EPS of Tk 0.03 for April-June, 2018 against Tk 0.47 for April-June, 2017, while Bank Asia reported consolidated EPS of Tk 0.56 against Tk 0.37, BRAC Bank Tk 1.18 against Tk 1.02, City Bank Tk 1.11 against Tk 1.51, Dhaka Bank Tk 0.25 against Tk 0.22, Dutch-Bangla Bank Tk 4.93 against Tk 4.18, Eastern Bank Tk 1.14 against Tk 1.04, EXIM Bank Tk 0.47 against Tk 0.98, First Securities Islami Bank Tk 0.06 against Tk 0.33and IFIC Tk 0.16 against Tk 0.39.

Islami Bank reported consolidated EPS of Tk 1.52 against Tk 1.14, Jamuna Bank Tk 1.24 against Tk 0.91, Mercantile Bank Tk 1.09 against Tk 0.90, Mutual Trust Bank Tk 0.88 against Tk 0.23, National Bank Tk 0.44 against Tk 0.22, NCC Bank Tk 0.61 against Tk 0.42, ONE Bank Tk 0.09 against Tk 0.64, Premier Bank Tk 0.58 against Tk 0.51, Prime Bank Tk 0.40 against Tk 0.07, Pubali Bank Tk 1.44 against Tk 0.50, Rupali Bank Tk 0.17 against Tk 0.28, Shahjalal Islami Bank Tk 0.60 against Tk 0.49, SIBL Tk 0.08 against Tk 0.27, Southeast Bank Tk 1.05 against Tk 0.34, Standard Bank Tk 0.03 against Tk 0.24, Trust Bank Tk 0.25 against Tk 1.07, UCB Tk 0.74 against Tk 1.15, and Uttara Bank Tk 1.0 against Tk 1.32.

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